AUDITED ANNUAL FINANCIAL STATEMENTS EDUCATORS FINANCIAL GROUP INC.

Transcription

1 AUDITED ANNUAL FINANCIAL STATEMENTS EDUCATORS FINANCIAL GROUP INC. EDUCATORS MONEY MARKET FUND EDUCATORS MORTGAGE & INCOME FUND EDUCATORS BOND FUND EDUCATORS BALANCED FUND EDUCATORS MONTHLY INCOME FUND EDUCATORS DIVIDEND FUND EDUCATORS GROWTH FUND EDUCATORS NORTH AMERICAN DIVERSIFIED FUND Dated: December 31, 2016

2 Educators Financial Group Inc. Funds Audited Annual Financial Statements December 31, 2016

3 Contents Page Management s Responsibility for Financial Reporting Auditor's Report Educators Money Market Fund Statements of Financial Position 1 Statements of Comprehensive Income 2 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 2 Statements of Cash Flows 3 Schedule of Investments 4 Educators Mortgage & Income Fund Statements of Financial Position 5 Statements of Comprehensive Income 6 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 6 Statements of Cash Flows 7 Schedule of Investments 8-9 Educators Bond Fund Statements of Financial Position 10 Statements of Comprehensive Income 11 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 11 Statements of Cash Flows 12 Schedule of Investments 13 Educators Balanced Fund Statements of Financial Position 14 Statements of Comprehensive Income 15 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 15 Statements of Cash Flows 16 Schedule of Investments Educators Monthly Income Fund Statements of Financial Position 21 Statements of Comprehensive Income 22 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 22 Statements of Cash Flows 23 Schedule of Investments Educators Dividend Fund Statements of Financial Position 28 Statements of Comprehensive Income 29 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 29 Statements of Cash Flows 30 Schedule of Investments Educators Growth Fund Statements of Financial Position 33 Statements of Comprehensive Income 34 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 34 Statements of Cash Flows 35 Schedule of Investments Educators North American Diversified Fund Statements of Financial Position 38 Statements of Comprehensive Income 39 Statements of Changes in Net Assets Attributable to Holders of Redeemable Units 39 Statements of Cash Flows 40 Schedule of Investments Notes to the Financial Statements 45-73

4 Management s Responsibility for Financial Reporting March 16, 2017 The accompanying financial statements of the Educators Financial Group Inc. Funds (the Funds ) have been prepared by Educators Financial Group Inc. (the Manager-Trustee ). The Manager-Trustee of the Funds is responsible for the information and representations contained in these financial statements. The Manager-Trustee maintains appropriate processes to ensure that relevant and reliable financial information is produced. The financial statements have been prepared in accordance International Financial Reporting Standards and include certain amounts that are based on estimates and judgements. The significant accounting policies which management believes are appropriate for the Funds are described in Note 2 to the financial statements. The Board of Directors of Educators Financial Group Inc. is responsible for reviewing and approving the financial statements of the Funds and reviewing management s report of its financial reporting responsibilities. Grant Thornton LLP, the external auditors of the Funds, have been appointed by the Board of Directors. Grant Thornton LLP have audited the financial statements in accordance with Canadian generally accepted auditing standards to enable them to express to unitholders their opinion on the financial statements. Their auditors report is set out below. Signed Chuck Hamilton Chuck Hamilton Chief Executive Officer, Educators Financial Group Inc. Signed Stuart Mulcahy Stuart Mulcahy Chief Financial Officer, Educators Financial Group Inc.

5 Independent Auditor s Report To the Unitholders of Grant Thornton LLP Suite Allstate Parkway Markham, ON L3R 5B4 T F Educators Money Market Fund Educators Mortgage & Income Fund Educators Bond Fund Educators Balanced Fund Educators Monthly Income Fund Educators Dividend Fund Educators Growth Fund Educators North American Diversified Fund Collectively referred to as the Funds We have audited the accompanying financial statements of each of the Funds, which comprise the statements of financial position as at December 31, 2016 and December 31, 2015, and the statements of comprehensive income, statements of changes in net assets attributable to holders of redeemable units and statements of cash flows for the years ended December 31, 2016 and 2015, and a summary of significant accounting policies and other explanatory information. Management s responsibility for the financial statements Management is responsible for the preparation and fair presentation of these financial statements in accordance with International Financial Reporting Standards, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. Auditor s responsibility Our responsibility is to express an opinion on these financial statements based on our audits. We conducted our audits in accordance with Canadian generally accepted auditing standards. Those standards require that we comply with ethical requirements and plan and perform the audits to obtain reasonable assurance about whether the financial statements are free from material misstatement.

6 An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements. The procedures selected depend on the auditor s judgment, including the assessment of the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control relevant to the entity s preparation and fair presentation of the financial statements in order to design audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the entity s internal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness of accounting estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that the audit evidence we have obtained in our audits is sufficient and appropriate to provide a basis for our audit opinion. Opinion In our opinion, the financial statements present fairly, in all material respects, the financial position of the each of the Funds as at December 31, 2016 and December 31, 2015, and the financial performance and the cash flows of each of the Funds for the years ended December 31, 2016 and 2015 in accordance with International Financial Reporting Standards. Markham, Canada March 16, 2017 Chartered Professional Accountants Licensed Public Accountants

7 Educators Money Market Fund Statements of Financial Position As at December Assets Current assets Cash $ 29,886 $ - Interest receivable 22,653 15,516 Subscriptions receivable 382,177 87,916 Investments 16,732,269 19,407,981 Total assets $ 17,166,985 $ 19,511,413 Liabilities Current liabilities Bank overdraft - 50,207 Redemptions payable 29,919 19,393 Distributions payable Amounts due to Manager-Trustee (Note 6) 7,801 7,461 Total liabilities 37,828 77,061 Net assets attributable to holders of redeemable units $ 17,129,157 $ 19,434,352 Number of redeemable units outstanding (Note 3) 1,712,916 1,943,435 Net assets attributable to holders of redeemable units per unit $ $ On behalf of the Manager-Trustee: Educators Financial Group Inc. Signed "Chuck Hamilton", President & CEO Signed "Stuart Mulcahy", CFO See accompanying notes to the financial statements 1

8 Educators Money Market Fund Statements of Comprehensive Income Years ended December Income Interest for distribution purposes $ 101,665 $ 147,753 Securities lending (Note 5) 3,117 4,368 Total income 104, ,121 Expenses Management fees (Note 6) 94, ,422 Harmonised sales tax 10,295 11, , ,339 Less expenses waived/absorbed by Manager-Trustee (Note 6) (14,491) (15,038) Total expenses 90, ,301 Increase in net assets attributable to holders of redeemable units $ 14,681 $ 47,820 Weighted average units outstanding during the year 1,718,050 1,952,747 Increase in net assets attributable to holders of redeemable units per unit $ 0.01 $ 0.02 Educators Money Market Fund Statements of Changes in Net Assets Attributable to Holders of Redeemable Units Years ended December Net assets attributable to holders of redeemable units, beginning of year $ 19,434,352 $ 20,163,139 Increase in net assets attributable to holders of redeemable units 14,681 47,820 Distributions to holders of redeemable units From net investment income (15,286) (47,677) Total distributions to holders of redeemable units (15,286) (47,677) Redeemable unit transactions Proceeds from redeemable units issued 8,090,754 8,589,593 Redemption of redeemable units (10,409,744) (9,365,768) Reinvestments of distributions to holders of redeemable units 14,400 47,245 Net decrease from redeemable unit transactions (2,304,590) (728,930) Net decrease in net assets attributable to holders of redeemable units (2,305,195) (728,787) Net assets attributable to holders of redeemable units, end of year $ 17,129,157 $ 19,434,352 See accompanying notes to the financial statements 2

9 Educators Money Market Fund Statements of Cash Flows Years ended December Cash Flow from Operating Activities Increase in net assets attributable to holders of redeemable units $ 14,681 $ 47,820 Adjustments for: Purchase of investments (59,646,352) (70,821,242) Proceeds from disposal of investments 62,322,064 71,479,972 (Increase) decrease in interest receivable (7,137) 19,912 Increase (decrease) in amounts due to Manager-Trustee 340 (3,337) Cash provided by operating activities 2,683, ,125 Cash Flow from Financing Activities Proceeds from redeemable units issued 7,796,493 8,551,465 Redemption of redeemable units (10,399,218) (9,363,932) Distributions paid to holders of redeemable units, net of reinvested distributions (778) (445) Cash used by financing activities (2,603,503) (812,912) Increase (decrease) in cash $ 80,093 $ (89,787) (Bank overdraft) cash, beginning of year $ (50,207) $ 39,580 Cash (bank overdraft), end of year $ 29,886 $ (50,207) Supplemental cash flow information: Interest received $ 94,528 $ 167,665 See accompanying notes to the financial statements 3

10 Educators Money Market Fund Schedule of Investments As at December 31, 2016 Par Value Description Coupon Rate Maturity Date Average Cost % of Net Assets Attributable to Fair Holders of Value Redeemable Units Short-Term Investments Bankers' Acceptances 335,000 Bank of Montreal 0.780% 3-Jan , , ,000 Bank of Montreal 0.900% 25-Apr , , ,000 Bank of Nova Scotia 0.851% 3-May , , ,000 Bank of Nova Scotia 0.951% 7-Jun , , ,000 Canadian Imperial Bank of Commerce 0.891% 7-Jul , , ,000 Royal Bank of Canada 0.870% 22-Mar , , ,000 Royal Bank of Canada 0.889% 28-Mar , , ,000 Toronto Dominion Bank 0.799% 12-Jan , , ,000 Toronto Dominion Bank 0.950% 17-Apr , ,084 3,379,604 3,379, Discount Commercial Paper 500,000 Clarity Trust 0.929% 6-Jan , , ,000 OMERS Finance Trust 0.780% 6-Mar , ,739 1,147,584 1,147, Treasury Bills 275,000 Canada Treasury Bill 0.438% 4-Jan , , ,000 Canada Treasury Bill 0.417% 5-Jan , , ,000 Canada Treasury Bill 0.535% 12-Jan , ,499 1,800,000 Canada Treasury Bill 0.511% 26-Jan ,795,648 1,795,648 1,065,000 Canada Treasury Bill 0.535% 9-Feb ,061,865 1,061, ,000 Canada Treasury Bill 0.500% 23-Feb , ,384 1,450,000 Canada Treasury Bill 0.530% 9-Mar ,445,874 1,445, ,000 Canada Treasury Bill 0.529% 23-Mar , , ,000 Canada Treasury Bill 0.539% 6-Apr , , ,000 Canada Treasury Bill 0.480% 20-Apr , , ,000 Canada Treasury Bill 0.534% 18-May , ,538 1,340,000 Canada Treasury Bill 0.510% 1-Jun ,335,785 1,335, ,000 Canada Treasury Bill 0.560% 15-Jun , ,107 1,825,000 Canada Treasury Bill 0.561% 29-Jun ,819,273 1,819,273 12,205,081 12,205, ,732,269 16,732, Total Investments $ 16,732,269 16,732, Other Assets Less Liabilities 396, Net Assets Attributable to Holders of Redeemable Units $ 17,129,

11 Educators Mortgage & Income Fund Statements of Financial Position As at December Assets Current assets Cash $ 78,907 $ 87,190 Interest receivable 722, ,246 Subscriptions receivable 465, ,920 Investments 198,624, ,820,020 Total assets $ 199,891,844 $ 204,814,376 Liabilities Current liabilities Redemptions payable 269, ,378 Distributions payable 4,734 5,645 Amounts due to Manager-Trustee (Note 6) 192, ,141 Forward contracts (Note 10) 4,194 27,417 Total liabilities 471, ,581 Net assets attributable to holders of redeemable units $ 199,420,800 $ 204,315,795 Number of redeemable units outstanding (Note 3) 17,566,363 17,955,859 Net assets attributable to holders of redeemable units per unit $ $ On behalf of the Manager-Trustee: Educators Financial Group Inc. Signed "Chuck Hamilton", President & CEO Signed "Stuart Mulcahy", CFO See accompanying notes to the financial statements 5

12 Educators Mortgage & Income Fund Statements of Comprehensive Income Years ended December Income Interest for distribution purposes $ 6,104,614 $ 6,639,605 Security lending (Note 5) 24,784 10,982 Other changes in fair value of investments: Net realized gain 615, ,632 Net realized gain (loss) on forward contracts 89,462 (301,375) Net change in unrealized appreciation (depreciation) on forward contracts 23,223 (29,781) Net change in unrealized depreciation (1,180,619) (1,197,159) Total income 5,676,814 5,461,904 Expenses Management fees (Note 6) 2,211,640 2,274,561 Independent review committee fees 20,566 22,246 Withholding taxes 9,589 4,005 Harmonised sales tax 271, ,874 2,513,682 2,580,686 Less expenses waived/absorbed by Manager-Trustee (Note 6) (105,626) (108,352) Total expenses 2,408,056 2,472,334 Increase in net assets attributable to holders of redeemable units $ 3,268,758 $ 2,989,570 Weighted average units outstanding during the year 17,708,915 18,026,952 Increase in net assets attributable to holders of redeemable units per unit $ 0.18 $ 0.17 Educators Mortgage & Income Fund Statements of Changes in Net Assets Attributable to Holders of Redeemable Units Years ended December Net assets attributable to holders of redeemable units, beginning of year $ 204,315,795 $ 205,272,513 Increase in net assets attributable to holders of redeemable units 3,268,758 2,989,570 Distributions to holders of redeemable units From net investment income (3,723,315) (4,164,413) Total distributions to holders of redeemable units (3,723,315) (4,164,413) Redeemable unit transactions Proceeds from redeemable units issued 26,337,570 33,125,668 Redemption of redeemable units (34,435,557) (36,991,502) Reinvestments of distributions to holders of redeemable units 3,657,549 4,083,959 Net (decrease) increase from redeemable unit transactions (4,440,438) 218,125 Net decrease in net assets attributable to holders of redeemable units (4,894,995) (956,718) Net assets attributable to holders of redeemable units, end of year $ 199,420,800 $ 204,315,795 See accompanying notes to the financial statements 6

13 Educators Mortgage & Income Fund Statements of Cash Flows Years ended December Cash Flow from Operating Activities Increase in net assets attributable to holders of redeemable units $ 3,268,758 $ 2,989,570 Adjustments for: Net realized gain on sale of investments (615,350) (339,632) Net change in unrealized depreciation in value of investments 1,180,619 1,197,159 Net change in unrealized (appreciation) depreciation on forward contracts (23,223) 29,781 Purchase of investments (142,319,963) (84,350,423) Proceeds from disposal of investments 146,950,282 84,045,048 Decrease in interest receivable 68, ,127 Decrease in amounts due to Manager-Trustee (13,308) (13,840) Cash provided by operating activities 8,496,266 3,826,790 Cash Flow from Financing Activities Proceeds from redeemable units issued 25,987,780 33,329,241 Redemption of redeemable units (34,425,652) (37,227,534) Distributions paid to holders of redeemable units, net of reinvested distributions (66,677) (81,321) Cash used by financing activities (8,504,549) (3,979,614) Decrease in cash $ (8,283) $ (152,824) Cash, beginning of year $ 87,190 $ 240,014 Cash, end of year $ 78,907 $ 87,190 Supplemental cash flow information: Interest received $ 6,173,065 $ 6,908,732 See accompanying notes to the financial statements 7

14 Educators Mortgage & Income Fund Schedule of Investments As at December 31, 2016 Par Value or No. of Units Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units Short-Term Investments Treasury Bills 250,000 Canadian Treasury Bill 0.480% 9-Feb , ,816 1,410,000 Canadian Treasury Bill 0.444% 6-Apr ,408,039 1,408,039 1,657,855 1,657, Canadian Bonds Asset-Backed 1,875,000 Canadian Mortgage Pools 1.300% 1-Aug ,831,700 1,818,138 1,400,000 Canadian Mortgage Pools 1.370% 1-Nov ,379,892 1,377,253 1,925,000 Institutional Mortgage Securities Canada Inc % 12-Sep ,786,747 1,749,948 1,200,000 MCAP CMBS Issuer Corp % 12-Apr ,122,925 1,125, ,000 MCAP CMBS Issuer Corp % 12-Apr , , ,000 MCAP CMBS Issuer Corp % 12-Apr , , ,000 MCAP CMBS Issuer Corp % 12-Apr , ,487 2,710,000 MCAP RMBS Issuer Corp % 15-Apr ,723,645 1,726, ,000 Real Estate Asset Liquidity Trust 1.856% 12-Sep , , ,000 Real Estate Asset Liquidity Trust 5.198% 12-Mar , ,376 2,075,000 Real Estate Asset Liquidity Trust 2.557% 12-Oct ,956,347 1,971,270 1,696,000 Schooner Trust 5.192% 12-Jun ,028 33,167 12,408,456 12,322, Corporate Bonds 2,000,000 Bank of Montreal 3.340% 8-Dec ,035,130 2,037, ,000 Bank of Montreal 3.320% 1-Jun , , ,000 Bank of Nova Scotia 2.090% 9-Sep , , ,000 Bank of Nova Scotia 1.900% 2-Dec , ,555 1,160,000 Brookfield Asset Management Inc % 1-Mar ,256,002 1,279, ,000 Brookfield Infrastructure Finance ULC 3.538% 30-Oct , , ,000 Brookfield Infrastructure Finance ULC 3.452% 11-Mar , ,112 2,920,000 Cameco Corp % 2-Sep ,204,056 3,129,591 1,675,000 Canadian Imperial Bank of Commerce 3.420% 26-Jan ,709,739 1,707,371 1,010,000 Canadian Natural Resources Ltd % 19-Jun ,017,116 1,030, ,000 Canadian Natural Resources Ltd % 14-Aug , ,929 2,020,000 Canadian Western Bank 3.077% 14-Jan ,068,342 2,058, ,000 Canadian Western Bank 2.751% 29-Jun , ,128 1,000,000 CDP Financial Inc % 15-Jul ,034,719 1,101, ,000 Empire Life Insurance Co % 16-Dec , , ,000 Enbridge Gas Distribution Inc % 23-Nov , ,254 1,030,000 Enbridge Income Fund 4.100% 22-Feb ,085,002 1,078,783 1,025,000 Equitable Bank 2.595% 7-Apr ,025,951 1,027, ,000 Equitable Group Inc % 23-Oct , , ,000 First Capital Realty Inc % 5-Dec , , ,000 Ford Credit Canada Ltd % 19-Feb , , ,000 Ford Credit Canada Ltd % 10-May , ,222 2,005,000 General Motors Financial of Canada Ltd % 22-May ,024,725 2,032,846 3,675,000 Genworth MI Canada Inc % 15-Jun ,179,388 3,969, ,000 Granite REIT Holdings LP 3.788% 5-Jul , , ,000 HCN Canadian Holdings-1 LP 3.350% 25-Nov , , ,000 Home Trust Co % 6-Mar , ,907 2,540,000 Home Trust Co % 10-Dec ,559,263 2,567,621 1,210,000 Husky Energy Inc % 12-Mar ,246,594 1,311,383 1,500,000 Intact Financial Corp % 3-Sep ,552,890 1,644,463 2,000,000 Manufacturers Life Insurance Co % 29-Nov ,018,400 2,033, ,000 Manufacturers Life Insurance Co % 1-Jun , ,758 1,025,000 National Bank of Canada 1.809% 26-Jul ,017,835 1,016, ,000 Pembina Pipeline Corp % 24-Oct , , ,000 Penske Truck Leasing Canada Inc % 1-Feb , ,840 2,280,000 Royal Bank of Canada 3.310% 20-Jan ,318,756 2,314,156 2,250,000 Saputo Inc % 23-Jun ,249,823 2,250, ,000 Sun Life Financial Inc % 30-Jan , , ,000 Sun Life Financial Inc., Floating Rate Note 2.600% 25-Sep , ,172 1,000,000 Suncor Energy Inc % 26-Nov ,053,890 1,042,730 1,950,000 TMX Group Ltd % 3-Oct ,150,577 2,125,995 1,525,000 Toronto-Dominion Bank 2.692% 24-Jun ,530,438 1,522,153 8

15 Educators Mortgage & Income Fund Schedule of Investments As at December 31, 2016 Par Value or No. of Units Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units 1,040,000 Toronto-Dominion Bank, Floating Rate Note 2.982% 30-Sep ,031,467 1,047,262 2,405,000 WestJet Airlines Ltd % 23-Jul ,423,346 2,452,533 53,147,093 53,194, Government Bonds 2,500,000 Canada Housing Trust No % 15-Dec ,619,527 2,522,203 11,775,000 Canada Housing Trust No % 15-Sep ,823,224 11,444,474 2,500,000 Canadian Government Real Return Bond 6.603% 1-Dec ,838,454 4,717,570 1,350,000 Province of Alberta Canada 1.350% 1-Sep ,349,231 1,331,853 20,630,436 20,016, ,185,985 85,533, Canadian Mutual Funds 374,549 HSBC Global High Yield Bond Pooled Fund 3,131,492 3,080,968 7,925,414 HSBC Mortgage Fund, Institutional Series 84,611,793 84,924,775 87,743,285 88,005, Foreign Bonds United Kingdom 1,420,000 Aviva PLC 4.500% 10-May ,458,470 1,484,780 3,645,000 BAA Funding Ltd % 3-Jul ,737,223 3,835,192 2,230,000 BP Capital Markets PLC 3.497% 9-Nov ,270,126 2,344,830 7,465,819 7,664, United States 3,780,000 AT&T Inc % 25-Nov ,863,082 3,975,510 1,950,000 Citigroup Inc % 18-Nov ,025,810 2,031, ,000 Citigroup Inc % 11-Oct , ,747 3,900,000 Goldman Sachs Group Inc % 19-Apr ,023,932 3,835, ,000 JPMorgan Chase & Co % 22-Feb , ,219 3,200,000 Merrill Lynch & Co. Inc % 30-May ,250,509 3,156, ,000 QVC Inc % 1-Apr ,999 1,113, ,000 Wells Fargo & Co % 15-Mar , ,084 15,763,655 15,762, ,229,474 23,427, Total Investments 198,816, ,624, Total Investments $ 198,816, ,624, Other Assets Less Liabilities 796, Net Assets Attributable to Holders of Redeemable Units $ 199,420,

16 Educators Bond Fund Statements of Financial Position As at December Assets Current assets Subscriptions receivable $ 18,755 $ 2,316 Due from brokers - 12,251 Investments 10,143,665 8,910,817 Total assets $ 10,162,420 $ 8,925,384 Liabilities Current liabilities Bank overdraft 5,786 - Redemptions payable 6,172 12,563 Distributions payable 77 - Amounts due to Manager-Trustee (Note 6) 10,318 9,369 Total liabilities 22,353 21,932 Net assets attributable to holders of redeemable units $ 10,140,067 $ 8,903,452 Number of redeemable units outstanding (Note 3) 1,032, ,328 Net assets attributable to holders of redeemable units per unit $ 9.82 $ 9.93 On behalf of the Manager-Trustee: Educators Financial Group Inc. Signed "Chuck Hamilton", President & CEO Signed "Stuart Mulcahy", CFO See accompanying notes to the financial statements 10

17 Educators Bond Fund Statements of Comprehensive Income Years ended December Income Interest for distribution purposes $ 270,931 $ 281,807 Other changes in fair value of investments: Net realized gain (loss) 69,512 (13,351) Net change in unrealized depreciation (181,069) (99,710) Total income 159, ,746 Expenses Management fees (Note 6) 101,704 98,114 Independent review committee fees Harmonised sales tax 12,996 12,567 Total expenses 115, ,641 Increase in net assets attributable to holders of redeemable units $ 43,716 $ 57,105 Weighted average units outstanding during the year 921, ,526 Increase in net assets attributable to holders of redeemable units per unit $ 0.05 $ 0.06 Educators Bond Fund Statements of Changes in Net Assets Attributable to Holders of Redeemable Units Years ended December Net assets attributable to holders of redeemable units, beginning of year $ 8,903,452 $ 8,868,143 Increase in net assets attributable to holders of redeemable units 43,716 57,105 Distributions to holders of redeemable units From net investment income (156,221) (169,482) From net realized gains (38,968) - Total distributions to holders of redeemable units (195,189) (169,482) Redeemable unit transactions Proceeds from redeemable units issued 2,464,274 1,379,260 Redemption of redeemable units (1,271,211) (1,401,030) Reinvestments of distributions to holders of redeemable units 195, ,456 Net increase from redeemable unit transactions 1,388, ,686 Net increase in net assets attributable to holders of redeemable units 1,236,615 35,309 Net assets attributable to holders of redeemable units, end of year $ 10,140,067 $ 8,903,452 See accompanying notes to the financial statements 11

18 Educators Bond Fund Statements of Cash Flows Years ended December Cash Flow from Operating Activities Increase in net assets attributable to holders of redeemable units $ 43,716 $ 57,105 Adjustments for: Net realized (gain) loss on sale of investments (69,512) 13,351 Net change in unrealized depreciation in value of investments 181,069 99,710 Purchase of investments (2,055,023) (949,375) Proceeds from disposal of investments 722, ,781 Increase (decrease) in amounts due to Manager-Trustee 949 (685) Cash (used) provided by operating activities (1,175,932) 39,887 Cash Flow from Financing Activities Proceeds from redeemable units issued 2,447,835 1,383,291 Redemption of redeemable units (1,277,602) (1,423,119) Distributions paid to holders of redeemable units, net of reinvested distributions (87) (59) Cash provided (used) by financing activities 1,170,146 (39,887) Decrease in cash $ (5,786) $ - Cash, beginning of year $ - $ - Bank overdraft, end of year $ (5,786) $ - See accompanying notes to the financial statements 12

19 Educators Bond Fund Schedule of Investments As at December 31, 2016 No. of Units Description Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units Canadian Mutual Funds 834,794 Beutel Goodman Income Fund, Class I 10,592,396 10,143, Total Investments $ 10,592,396 10,143, Other Liabilities Less Assets (3,598) (0.04) Net Assets Attributable to Holders of Redeemable Units $ 10,140,

20 Educators Balanced Fund Statements of Financial Position As at December Assets Current assets Cash $ - $ 331,827 Interest and dividends receivable 469, ,935 Subscriptions receivable 514, ,593 Due from brokers 719,630 1,248,071 Investments 201,506, ,172,225 Total assets $ 203,210,170 $ 182,449,651 Liabilities Current liabilities Bank overdraft 6,501 - Due to brokers 482,642 1,261,495 Redemptions payable 197,938 97,782 Distributions payable 38,556 24,479 Amounts due to Manager-Trustee (Note 6) 316, ,932 Total liabilities 1,041,695 1,678,688 Net assets attributable to holders of redeemable units $ 202,168,475 $ 180,770,963 Number of redeemable units outstanding (Note 3) 11,162,886 10,565,315 Net assets attributable to holders of redeemable units per unit $ $ On behalf of the Manager-Trustee: Educators Financial Group Inc. Signed "Chuck Hamilton", President & CEO Signed "Stuart Mulcahy", CFO See accompanying notes to the financial statements 14

21 Educators Balanced Fund Statements of Comprehensive Income Years ended December Income Interest for distribution purposes $ 3,599,714 $ 3,072,628 Dividends 2,047,987 2,162,007 Securities lending (Note 5) 16,187 6,729 Other changes in fair value of investments: Net realized gain 5,868,065 3,138,586 Net change in unrealized appreciation (depreciation) 8,475,234 (2,212,795) 20,007,187 6,167,155 Expenses Management fees (Note 6) 3,271,048 3,147,159 Independent review committee fees 19,367 19,503 Transaction costs 21,445 18,259 Withholding taxes 2,853 (1,290) Harmonised sales tax 409, ,198 3,724,395 3,577,829 Less expenses waived/absorbed by Manager-Trustee (Note 6) (95,219) (91,358) Total expenses 3,629,176 3,486,471 Increase in net assets attributable to holders of redeemable units $ 16,378,011 $ 2,680,684 Weighted average units outstanding during the year 10,661,919 10,204,626 Increase in net assets attributable to holders of redeemable units per unit $ 1.54 $ 0.26 Educators Balanced Fund Statements of Changes in Net Assets Attributable to Holders of Redeemable Units Years ended December Net assets attributable to holders of redeemable units, beginning of year $ 180,770,963 $ 171,914,337 Increase in net assets attributable to holders of redeemable units 16,378,011 2,680,684 Distributions to holders of redeemable units From net investment income (2,103,279) (1,588,063) From net realized gains (3,656,992) (1,816,329) Total distributions to holders of redeemable units (5,760,271) (3,404,392) Redeemable unit transactions Proceeds from redeemable units issued 26,966,029 27,142,782 Redemption of redeemable units (21,909,322) (20,943,065) Reinvestments of distributions to holders of redeemable units 5,723,065 3,380,617 Net increase from redeemable unit transactions 10,779,772 9,580,334 Net increase in net assets attributable to holders of redeemable units 21,397,512 8,856,626 Net assets attributable to holders of redeemable units, end of year $ 202,168,475 $ 180,770,963 See accompanying notes to the financial statements 15

22 Educators Balanced Fund Statements of Cash Flows Years ended December Cash Flow from Operating Activities Increase in net assets attributable to holders of redeemable units $ 16,378,011 $ 2,680,684 Adjustments for: Net realized gain on sale of investments (5,868,065) (3,138,586) Net change in unrealized (appreciation) depreciation in value of investments (8,475,234) 2,212,795 Purchase of investments (183,156,777) (224,263,149) Proceeds from disposal of investments 175,915, ,167,280 (Increase) decrease in interest and dividends receivable (29,823) 7,881 Increase (decrease) in amounts due to Manager-Trustee 21,126 (1,672) Cash used by operating activities (5,215,386) (6,334,767) Cash Flow from Financing Activities Proceeds from redeemable units issued 26,709,353 27,050,871 Redemption of redeemable units (21,809,166) (20,940,967) Distributions paid to holders of redeemable units, net of reinvested distributions (23,129) (28,342) Cash provided by financing activities 4,877,058 6,081,562 Decrease in cash $ (338,328) $ (253,205) Cash, beginning of year $ 331,827 $ 585,032 (Bank overdraft) cash, end of year $ (6,501) $ 331,827 Supplemental cash flow information: Dividends received, net of withholding taxes $ 2,058,792 $ 2,131,745 Interest received $ 3,558,823 $ 3,112,160 See accompanying notes to the financial statements 16

23 Educators Balanced Fund Schedule of Investments As at December 31, 2016 No. of Units or Shares or Par Value Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units Short-Term Investments Treasury Bills 950,000 Canadian Treasury Bill 0.529% 23-Mar , ,830 75,000 Canadian Treasury Bill 0.539% 6-Apr ,911 74,911 1,023,741 1,023, Canadian Bonds Corporate Bonds 56,000 AltaGas Ltd % 17-Jan ,005 59,079 34,000 AltaGas Ltd % 1-Jun ,005 36, ,000 AltaGas Ltd % 28-Sep , , ,000 AltaGas Ltd % 15-Jan , ,467 72,000 AltaGas Ltd % 13-Jan ,920 75, ,000 AltaLink LP 2.747% 29-May , , ,000 AltaLink LP 5.381% 26-Mar , , ,000 AltaLink LP 3.717% 3-Dec , ,374 18,000 AltaLink LP 4.446% 11-Jul ,590 19, ,000 Bank of Montreal 2.100% 6-Oct , ,938 1,260,000 Bank of Montreal 1.880% 31-Mar ,270,844 1,258, ,000 Bank of Montreal 1.610% 28-Oct , , ,000 Bank of Nova Scotia 2.750% 13-Aug , ,656 60,000 Bank of Nova Scotia 2.400% 28-Oct ,763 61, ,000 Bank of Nova Scotia 1.900% 2-Dec , , ,000 Bell Canada Inc % 10-Sep , , ,000 Bell Canada Inc % 1-Oct , , ,000 Bruce Power LP 2.844% 23-Jun , , ,000 Canadian Imperial Bank of Commerce 1.700% 9-Oct , , ,000 Canadian Imperial Bank of Commerce 2.350% 24-Jun , , ,000 Canadian Imperial Bank of Commerce 1.850% 14-Jul , , ,000 Canadian Imperial Bank of Commerce 1.900% 26-Apr , , ,000 Canadian Imperial Bank of Commerce 1.640% 12-Jul , ,843 3,000 Centra Gas Ontario Inc % 19-Oct ,466 3,349 2,000 CIBC Capital Trust, Floating Rate Note 9.976% 30-Jun ,402 2, ,000 CU Inc % 19-Nov , , ,000 CU Inc % 18-Nov , ,792 73,000 CU Inc % 14-Nov ,737 72,588 66,000 CU Inc % 7-Nov ,428 74, ,000 Emera Inc % 16-Jun , , ,000 Enbridge Gas Distribution Inc % 4-Dec , , ,000 Enbridge Gas Distribution Inc % 23-Nov , ,607 35,000 Enbridge Gas Distribution Inc % 2-Dec ,675 51,037 74,000 Enbridge Gas Distribution Inc % 11-Sep ,090 77,499 15,000 Enbridge Gas Distribution Inc % 29-Oct ,499 20,409 69,000 Enbridge Gas Distribution Inc % 15-Nov ,368 94, ,000 Enbridge Gas Distribution Inc % 22-Nov , ,138 65,000 Enbridge Pipelines Inc % 12-Nov ,305 70, ,000 Enbridge Pipelines Inc % 17-Nov , ,091 72,000 Enbridge Pipelines Inc % 15-Feb ,976 94, ,000 Enbridge Pipelines Inc % 10-Aug , , ,000 Enbridge Pipelines Inc % 6-Apr , ,479 98,000 Enbridge Pipelines Inc % 9-Aug ,700 95,649 51,000 FortisAlberta Inc % 30-Oct ,991 62,481 75,000 FortisAlberta Inc % 21-Sep ,195 67,833 54,000 FortisAlberta Inc % 27-Oct ,364 62,519 44,000 FortisBC Energy Inc % 21-Sep ,640 59,806 87,000 FortisBC Energy Inc % 1-May , , ,000 FortisBC Energy Inc % 26-Feb , ,037 52,000 FortisBC Inc % 24-Nov ,377 61,326 65,000 Hydro One Inc % 26-Sep ,112 71,233 93,000 Hydro One Inc % 19-Oct , ,241 35,000 Inter Pipeline Ltd % 30-May ,463 37, ,000 Inter Pipeline Ltd % 13-Sep , ,401 17

24 Educators Balanced Fund Schedule of Investments As at December 31, 2016 No. of Units or Shares or Par Value Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units 246,000 Inter Pipeline Ltd % 16-Dec , , ,000 Inter Pipeline Ltd % 30-May , , ,000 Lower Mattagami Energy LP 2.307% 21-Oct , , ,000 Lower Mattagami Energy LP 4.176% 23-Feb , , ,000 Nova Scotia Power Inc % 25-Aug , , ,000 Royal Bank of Canada 2.770% 11-Dec , ,779 1,256,000 Royal Bank of Canada 1.920% 17-Jul ,259,427 1,261, ,000 Royal Bank of Canada 2.030% 15-Mar , , ,000 Royal Bank of Canada 1.583% 13-Sep , , ,000 Royal Bank of Canada 2.333% 5-Dec , , ,000 Royal Bank of Canada 3.310% 20-Jan , , ,000 Toronto-Dominion Bank 2.447% 2-Apr , , ,000 Toronto-Dominion Bank 1.693% 2-Apr , , ,000 Toronto-Dominion Bank 2.563% 24-Jun , , ,000 Toronto-Dominion Bank 2.045% 8-Mar , , ,000 Toronto-Dominion Bank 2.621% 22-Dec , , ,000 Toronto-Dominion Bank 1.909% 18-Jul , , ,000 TransCanada PipeLines Ltd % 19-Jul , ,813 54,000 TransCanada PipeLines Ltd % 17-Jul ,258 56, ,000 TransCanada PipeLines Ltd % 5-Feb , ,905 29,000 TransCanada PipeLines Ltd % 15-Jan ,810 37, ,000 TransCanada PipeLines Ltd % 15-Apr , , ,000 TransCanada PipeLines Ltd % 26-May , , ,000 TransCanada PipeLines Ltd % 25-Apr , ,283 22,000 TransCanada PipeLines Ltd % 16-Jan ,511 30,595 22,000 TransCanada PipeLines Ltd % 15-Aug ,566 30,645 41,000 TransCanada PipeLines Ltd % 6-Jun ,797 41,733 12,000 Union Gas Ltd % 25-Apr ,592 13,630 59,000 Union Gas Ltd % 10-Nov ,491 83, ,000 Union Gas Ltd % 1-Jun , , ,000 Union Gas Ltd % 23-Jul , ,052 87,000 Veresen Inc % 10-Nov ,992 87,383 20,000 Westcoast Energy Inc % 4-Sep ,655 22, ,000 Westcoast Energy Inc % 16-Jan , , ,000 Westcoast Energy Inc % 10-Jan , , ,000 Westcoast Energy Inc % 2-Jul , , ,000 Westcoast Energy Inc % 28-Oct , ,940 41,000 Westcoast Energy Inc % 21-Jul ,417 57, ,000 Westcoast Energy Inc % 8-Dec , , ,000 Westcoast Energy Inc % 18-Dec , ,920 96,000 Westcoast Energy Inc % 20-Mar , ,941 26,037,367 25,874, Government Bonds 1,952,000 Canada Housing Trust No % 15-Jun ,017,271 1,995, ,000 Canada Housing Trust No % 15-Jun , , ,000 Canadian Government Bond 1.500% 1-Mar , ,948 1,190,000 Canadian Government Bond 0.500% 1-Nov ,187,669 1,184, ,000 Canadian Government Bond 0.500% 1-Feb , , ,000 Canadian Government Bond 1.750% 1-Sep , , ,000 Canadian Government Bond 0.750% 1-Sep , , ,000 Canadian Government Bond 0.500% 1-Mar , ,137 1,472,000 Canadian Government Bond 1.500% 1-Jun ,488,396 1,444,474 1,940,000 Canadian Government Bond 2.750% 1-Dec ,190,579 2,131, ,000 CPPIB Capital Inc % 10-Jun , , ,000 Province of Alberta 2.200% 1-Jun , , ,000 Province of Alberta 2.350% 1-Jun , , ,000 Province of Alberta 3.500% 1-Jun , ,141 46,000 Province of Alberta 3.900% 1-Dec ,904 50, ,000 Province of British Columbia 2.250% 1-Mar , , ,000 Province of British Columbia 2.850% 18-Jun , , ,000 Province of British Columbia 5.700% 18-Jun , , ,000 Province of British Columbia 6.350% 18-Jun , ,792 18

25 Educators Balanced Fund Schedule of Investments As at December 31, 2016 No. of Units or Shares or Par Value Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units 68,000 Province of British Columbia 4.700% 18-Jun ,872 84,045 14,000 Province of British Columbia 4.300% 18-Jun ,176 16, ,000 Province of British Columbia 3.200% 18-Jun , , ,000 Province of Manitoba 2.450% 2-Jun , , ,000 Province of Manitoba 3.250% 5-Sep , ,899 42,000 Province of Manitoba 3.750% 5-Sep ,885 44, ,000 Province of Manitoba 3.300% 2-Jun , , ,000 Province of Manitoba 4.400% 5-Sep , , ,000 Province of Manitoba 4.600% 5-Mar , ,007 26,000 Province of Manitoba 4.700% 5-Mar ,026 32, ,000 Province of Ontario 2.100% 8-Sep , ,752 1,133,000 Province of Ontario 4.200% 2-Jun ,277,443 1,237,865 1,575,000 Province of Ontario 2.850% 2-Jun ,679,879 1,650,306 1,927,000 Province of Ontario 3.500% 2-Jun ,126,407 2,092,838 1,573,000 Province of Ontario 2.600% 2-Jun ,607,419 1,598, ,000 Province of Ontario 6.200% 2-Jun ,088,769 1,032, ,000 Province of Ontario 4.700% 2-Jun , ,424 1,624,000 Province of Ontario 2.100% 8-Sep ,658,719 1,654,361 2,115,000 Province of Ontario 4.000% 2-Jun ,351,940 2,328,799 69,000 Province of Ontario 4.250% 1-Dec ,841 77,230 1,268,000 Province of Ontario 3.150% 2-Jun ,371,281 1,352,950 1,006,000 Province of Ontario 2.400% 2-Jun ,023, ,733 96,000 Province of Ontario 3.500% 2-Jun , , ,000 Province of Ontario 3.450% 2-Jun , ,864 42,000 Province of Ontario 3.500% 1-Dec ,639 43,862 1,900,000 Province of Ontario 2.900% 2-Dec ,893,728 1,780,808 2,216,000 Province of Ontario 2.800% 2-Jun ,197,390 2,040, ,000 Province of Quebec 2.750% 1-Sep , ,725 98,000 Province of Quebec 2.500% 1-Sep ,914 97, ,000 Province of Quebec 3.500% 1-Dec ,036, ,512 98,000 Province of Saskatchewan 5.800% 5-Sep , ,236 36,294,212 35,429, ,331,579 61,304, Canadian Common Stocks Consumer Discretionary 14,053 Canadian Tire Corp., Ltd., Class A 1,433,337 1,957,161 45,390 Magna International Inc. 1,757,354 2,646,237 33,600 Quebecor Inc. 889,747 1,253,952 16,500 Thomson Reuters Corp. 640, ,540 4,720,902 6,826, Consumer Staples 6,850 Loblaw Cos., Ltd. 347, ,254 12,700 Metro Inc. 300, ,032 11,470 Molson Coors Canada Inc. 707,708 1,497,982 1,355,620 2,493, Energy 66,360 Cameco Corp. 1,215, ,694 2,900 Suncor Energy Inc. 126, ,310 54,700 Canadian Natural Resources Ltd. 1,719,888 2,340, ,740 Cenovus Energy Inc. 3,742,872 3,039,722 6,804,982 6,439, Financials 52,200 Bank of Nova Scotia 2,834,312 3,902,472 57,970 Brookfield Asset Management Inc. 2,165,907 2,568,071 21,600 Canadian Imperial Bank of Commerce 1,935,355 2,366,496 56,300 Great-West Lifeco Inc. 1,756,263 1,980,071 6,150 IGM Financial Inc. 300, ,930 78,200 Manulife Financial Corp. 1,356,792 1,869,762 3,500 Onex Corp. 159, ,830 19

26 Educators Balanced Fund Schedule of Investments As at December 31, 2016 No. of Units or Shares or Par Value Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units 61,600 Royal Bank of Canada 3,883,360 5,597,592 84,900 Toronto-Dominion Bank 3,470,883 5,622,078 17,862,860 24,461, Industrials 21,180 Canadian National Railway Co. 1,016,912 1,913,825 5,600 Canadian Pacific Railway Ltd. 1,019,963 1,072,736 45,930 Finning International Inc. 1,100,701 1,207,500 24,120 SNC-Lavalin Group Inc. 1,080,968 1,393,895 4,218,544 5,587, Information Technology 19,241 Open Text Corp. 962,316 1,595, ,316 1,595, Materials 14,710 Agrium Inc. 1,695,404 1,985,262 7,800 Franco-Nevada Corp. 583, ,184 30,700 Potash Corp. of Saskatchewan Inc. 1,016, ,703 3,295,672 3,357, Telecommunication Services 77,250 Rogers Communications Inc. 3,505,787 4,000,778 40,800 TELUS Corp. 1,423,872 1,744,200 4,929,659 5,744, ,150,555 56,506, Canadian Mutual Funds 2,395,091 Beutel Goodman American Equity Fund, Class I 31,167,526 38,041,703 7,528,338 Beutel Goodman International Equity Fund, Class I 38,949,543 39,814, ,905 Beutel Goodman Small Cap Fund, Class I 3,768,713 4,816,109 73,885,782 82,672, Total Investments 181,391, ,506, Transaction Costs (31,224) Net Investments $ 181,360, ,506, Other Assets Less Liabilities 661, Net Assets Attributable to Holders of Redeemable Units $ 202,168,

27 Educators Monthly Income Fund Statements of Financial Position As at December Assets Current assets Cash $ 69,264 $ 45,015 Interest and dividends receivable 173, ,680 Subscriptions receivable 44, ,381 Due from brokers 181,484 79,122 Investments 54,502,534 49,682,480 Total assets $ 54,971,557 $ 50,027,678 Liabilities Current liabilities Due to brokers 156,260 62,628 Redemptions payable 25,194 17,584 Distributions payable 10,728 11,270 Amounts due to Manager-Trustee (Note 6) 57,904 55,114 Total liabilities 250, ,596 Net assets attributable to holders of redeemable units $ 54,721,471 $ 49,881,082 Number of redeemable units outstanding (Note 3) 5,408,281 5,030,870 Net assets attributable to holders of redeemable units per unit $ $ 9.92 On behalf of the Manager-Trustee: Educators Financial Group Inc. Signed "Chuck Hamilton", President & CEO Signed "Stuart Mulcahy", CFO See accompanying notes to the financial statements 21

28 Educators Monthly Income Fund Statements of Comprehensive Income Years ended December Income Interest for distribution purposes $ 344,317 $ 272,558 Dividends 1,164,583 1,092,427 Securities lending (Note 5) 21,285 11,001 Other changes in fair value of investments: Net realized (loss) gain (4,228) 1,867,057 Net change in unrealized appreciation (depreciation) 3,433,133 (1,776,323) Total income 4,959,090 1,466,720 Expenses Management fees (Note 6) 585, ,811 Independent review committee fees 5,287 5,251 Transaction costs 47,249 49,043 Withholding taxes 44,512 76,220 Harmonised sales tax 75,906 70,994 Total expenses 758, ,319 Increase in net assets attributable to holders of redeemable units $ 4,200,433 $ 717,401 Weighted average units outstanding during the year 5,192,080 4,594,962 Increase in net assets attributable to holders of redeemable units unit $ 0.81 $ 0.16 Educators Monthly Income Fund Statements of Changes in Net Assets Attributable to Holders of Redeemable Units Years ended December Net assets attributable to holders of redeemable units, beginning of year $ 49,881,082 $ 40,835,352 Increase in net assets attributable to holders of redeemable units 4,200, ,401 Distributions to holders of redeemable units From net investment income and return of capital (3,116,135) (1,207,891) From net realized gains - (1,567,704) Total distributions to holders of redeemable units (3,116,135) (2,775,595) Redeemable unit transactions Proceeds from redeemable units issued 8,939,113 13,873,701 Redemption of redeemable units (8,176,148) (5,418,989) Reinvestments of distributions to holders of redeemable units 2,993,126 2,649,212 Net increase from redeemable unit transactions 3,756,091 11,103,924 Net increase in net assets attributable to holders of redeemable units 4,840,389 9,045,730 Net assets attributable to holders of redeemable units, end of year $ 54,721,471 $ 49,881,082 See accompanying notes to the financial statements 22

29 Educators Monthly Income Fund Statements of Cash Flows Years ended December Cash Flow from Operating Activities Increase in net assets attributable to holders of redeemable units $ 4,200,433 $ 717,401 Adjustments for: Net realized loss (gain) on sale of investments 4,228 (1,867,057) Net change in unrealized (appreciation) depreciation in value of investments (3,433,133) 1,776,323 Purchase of investments (50,362,068) (58,654,512) Proceeds from disposal of investments 48,962,189 49,710,241 (Increase) decrease in interest and dividends receivable (62,930) 4,156 Increase in amounts due to Manager-Trustee 2,790 7,977 Cash used by operating activities (688,491) (8,305,471) Cash Flow from Financing Activities Proceeds from redeemable units issued 9,004,829 13,811,790 Redemption of redeemable units (8,168,538) (5,408,653) Distributions paid to holders of redeemable units, net of reinvested distributions (123,551) (125,680) Cash provided by financing activities 712,740 8,277,457 Increase (decrease) in cash $ 24,249 $ (28,014) Cash, beginning of year $ 45,015 $ 73,029 Cash, end of year $ 69,264 $ 45,015 Supplemental cash flow information: Dividends received, net of withholding taxes $ 1,083,984 $ 1,031,305 Interest received $ 317,706 $ 263,439 See accompanying notes to the financial statements 23

30 Educators Monthly Income Fund Schedule of Investments As at December 31, 2016 No. of Units or Shares or Par Value Description Coupon Rate Maturity Date Average Cost Fair Value % of Net Assets Attributable to Holders of Redeemable Units Short-Term Investments Treasury Bills 49,000 Canadian Treasury Bill 0.471% 9-Mar ,944 48, ,000 Canadian Treasury Bill 0.472% 23-Mar , , ,000 Canadian Treasury Bill 0.474% 6-Apr , , ,000 Canadian Treasury Bill 0.481% 20-Apr , , , , Canadian Bonds Asset-Backed 24,000 Ford Auto Securitization Trust 2.523% 15-Apr ,000 24,047 41,000 Ford Auto Securitization Trust 3.422% 15-Mar ,000 41,435 15,000 Institutional Mortgage Securities Canada Inc % 12-Jan ,594 15,161 27,000 Institutional Mortgage Securities Canada Inc % 12-Oct ,998 28, ,000 Institutional Mortgage Securities Canada Inc % 12-May , ,557 48,000 Institutional Mortgage Securities Canada Inc % 12-Jul ,997 49,238 68,000 MCAP CMBS Issuer Corp % 15-Apr ,042 43,317 80,000 MCAP CMBS Issuer Corp % 12-Apr ,144 79,863 18,000 Merrill Lynch Financial Assets Inc % 12-Jan ,532 17,955 54,000 Real Estate Asset Liquidity Trust 5.039% 12-Apr ,606 54,168 70,000 Real Estate Asset Liquidity Trust 3.451% 12-May ,995 67,214 73,000 Real Estate Asset Liquidity Trust 3.659% 12-Jul ,670 64, ,000 Real Estate Asset Liquidity Trust 3.179% 12-Jan ,992 98,070 84,000 Schooner Trust 5.198% 12-Jun ,834 84, , , Corporate Bonds 99, International Inc % 11-May ,420 99, ,000 Aimia Inc % 17-May , ,478 82,000 Algonquin Power Co % 15-Feb ,564 87,465 57,000 AltaGas Ltd % 15-Mar ,921 61, ,000 Bank of Montreal 3.320% 1-Jun , , ,000 Bank of Nova Scotia 1.900% 2-Dec , , ,000 Bank of Nova Scotia, Floating Rate Note 3.367% 8-Dec , ,352 61,000 bcimc Realty Corp % 29-Jun ,019 64, ,000 bcimc Realty Corp % 3-Jun , , ,000 Bell Canada Inc % 1-Oct , , ,000 Blackbird Infrastructure 407 GP 1.713% 8-Oct ,221 98, ,000 BMW Canada Inc % 15-Jun ,957 99,121 80,000 Cameco Corp % 24-Jun ,968 80, ,000 Canadian Imperial Bank of Commerce 3.420% 26-Jan , ,029 80,000 Canadian Tire Corp., Ltd % 24-Feb ,710 97,584 79,000 Canadian Western Bank 3.463% 17-Dec ,680 80,273 74,000 CARDS II Trust 2.155% 15-Oct ,000 75,087 50,000 Chip Mortgage Trust 2.330% 29-Apr ,000 49, ,000 Chip Mortgage Trust 2.981% 15-Nov , , ,000 CIBC Capital Trust, Floating Rate Note 9.976% 30-Jun , ,114 97,000 CU Inc % 2-Sep , ,773 35,000 CU Inc % 27-Jul ,967 35,944 75,000 Eagle Credit Card Trust 2.849% 17-Oct ,000 76,920 75,000 Eagle Credit Card Trust 3.469% 17-Oct ,000 76, ,000 EnerCare Solutions Inc % 3-Feb , , ,000 Fortified Trust 1.670% 23-Jul , ,474 50,000 FortisBC Energy Inc % 8-Apr ,970 49, ,000 Genesis Trust II 1.675% 17-Sep , , ,000 Genworth MI Canada Inc % 1-Apr , , ,000 Glacier Credit Card Trust 3.237% 20-Sep , , ,000 Hollis Receivables Term Trust II 1.788% 26-Feb , , ,000 Home Trust Co % 10-Dec , , ,000 Intact Financial Corp % 2-Mar , , ,000 Laurentian Bank of Canada 2.750% 22-Apr , , ,000 Leisureworld Senior Care LP 3.474% 3-Feb , ,143 24